National Pharmaceutical Pricing Authority (NPPA) has agreed to consider the additional cost involved in special packaging of pharmaceuticals on a case-to-case basis even after fixing the prices of scheduled formulations. The assurance will help pharma majors to go for costlier packing that are difficult to copy, thereby securing their popular brands from being imitated by the spurious drug manufacturers in the country.
The additional cost incurred during the process can be retrieved through appropriate pricing of the drug after seeking necessary clearances from the authority. Confirming NPPA decision, Arun Kshetrapal, chairman, NPPA said that the cases of special packaging would be considered on case-to-case basis and the companies could approach the authority with details of the cost involved in taking this extra precaution.
By agreeing to compensate for any increase in production cost due to additional expense for specialty packaging like hologram, the authority has made it clear that it doesn't stand in the way of pharmaceutical industry in their tirade against counterfeit drug manufacturers.
The decision would have a tremendous impact on the sales of the leading pharmaceutical manufacturers if the industry's complaint, that they are losing Rs 30,000 crore every year due to the presence of spurious/counterfeit drugs in the domestic market, is true.
Recently, industry associations had pointed out that the sale of certain popular brands of companies like Ranbaxy, Cipla and Pfizer showed a 20 per cent jump after they resorted to high security packaging, thereby wiping out the presence of counterfeit drugs which were eating into their business share over the years. The industry has been consistent in its plea to give them sufficient encouragement to switch on to high cost packing practices to counter the menace of counterfeiting.
The price control over drugs without considering the cost involved in special packing techniques, was one of the major reasons for the industry to go slow in modernizing its drug packaging systems. The new NPPA directive would now help them to switch over from standard packing systems to more sophisticated ones, without compromising their profit margins.